A provider or supplier (or their representative) can utilize the Medicare Appeals Process (Section 1869 of the Social Security Act and 42 CFR part 405 subpart I contain the procedures for conducting appeals of claims in Original Medicare (Medicare Part A and Part B)). However, in order for an appeal to be available, you must first file a claim and have that claim denied completely or partially. This is called the initial determination. An example of a partially denied claim could be that you coded a claim, and the Medicare Administrative Contractor (MAC) changed the coding and now you will be receiving less reimbursement. Alternatively, you could have submitted a claim, been paid, and then your claim is audited and then denied. This would usually allow you to utilize the appeals process as well. This document will examine the first three (3) levels of the appeals process as most providers and suppliers only utilize these levels. Utilizing a representative that understands the complex process is often in your best interest.
Practice Note: The key here is to read the denial information to make sure you understand the reason for denial. More importantly, you must be aware of the deadline to appeal. With today’s issues relating to postal delivery, make sure to send in any appeals using some sort of tracked mail, so that if an issue arises regarding timely filing, you can support your timeliness with documented tracked mail.
There may be opportunities to discuss your case with the reviewing contractor prior to a formal denial, called the Discussion Period. This is available if you receive an unfavorable or partially favorable Review Results letter from the Recovery Audit Contractor (RAC) and may also be available under certain Centers for Medicare and Medicaid Services (CMS) demonstration programs. (QIC Telephone Discussion and Reopening Process Demonstration | CMS).
Practice Note: If a Discussion Period is available, this may be your best and fastest opportunity to have your denial overturned.
The Five Levels of Appeal
There are five levels in the Medicare Part A and Part B (including DME) appeals process. If you get an unfavorable or partially favorable decision, you can generally appeal to the next level (may be subject to dollar thresholds) and you are required to receive information on appealing to the next level within the decision at the current level of appeal.
The formal levels of appeal are:
- First Level of Appeal: Redetermination by a Medicare Administrative Contractor (MAC)
- Second Level of Appeal: Reconsideration by a Qualified Independent Contractor (QIC)
- Third Level of Appeal: Decision by the Office of Medicare Hearings and Appeals (OMHA) – there is currently a requirement that you have at least $180 at issue to appeal at this level. You may be able to add claims together to reach this amount. This amount is subject to change each calendar year.
- Fourth Level of Appeal: Review by the Medicare Appeals Council (Council)
- Fifth Level of Appeal: Judicial Review in Federal District Court – there is currently a requirement that you have at least $1,760 at issue to appeal at this level. You may be able to add claims together to reach this amount. This amount is subject to change each calendar year.
- Practice Note: While the process appears to be simple, there is a complex set of regulations that must be followed. These regulations can be found in the Code of Federal Regulations at 42 CFR part 405 subpart I (42 CFR Part 405 Subpart I ).
Redetermination – this is the first level of appeal. Your claim is initially processed by the MAC. This is called the initial determination. The MAC, however, is also the entity that processes your first level of appeal called a redetermination. Following an initial denial of your claim, you have 120 days to appeal the initial determination to the MAC. While the redetermination is performed by the same MAC, it is managed by a separate department and processed by someone that was not involved in the initial determination. The MAC has 60 days to render a redetermination and when you receive the redetermination you should place a date-stamp on the envelope and the letter, keeping both. Should you be unsuccessful at the redetermination level of appeal, you will be advised in the letter you receive with respect to where you need to send your next appeal, and the deadline for sending that appeal.
The next appeal is called a reconsideration and it is sent to an entity called the Qualified Independent Contractor (QIC).
Practice Note: Aside from the Discussion Period, this is your first formal opportunity to appeal your denial, but it is often a rigid and narrow review of the initial claim determination. It is important to understand the reason for denial, which should be included with the Remittance Advice (RA) for the claim, or via an Explanation of Benefits (EOB). Based upon that reason, it is equally important to submit documentation to support your claim. The best way to do this is by telling a story with the documents – why did this particular patient, because of their specific medical condition, require the items or services they received. Most important, however, is to timely appeal within the 120-day deadline. Use tracked mail to be able to prove that you appealed timely – the appeal must be placed in the mail by the 120th day following the date of the RA or EOB, but do not leave it until the last day. If you are attempting to stop the recoupment of any monies at this level following a post-payment audit, you must appeal within 30 days of the date of the appeal decision.
Reconsideration – this is the second level of the appeals process and you send the appeal to the QIC identified in your redetermination letter within 180 days from the date you receive the redetermination letter, which you should have date-stamped upon receipt (including the envelope). The QIC is a CMS contractor that has the authority to perform the second level of appeal in the Medicare appeal process. Reconsiderations should be performed by the appropriate personnel – a physician for medical necessity and a coder for coding related claim issues. The QIC has 60 days to render a reconsideration. Should you be unsuccessful at the reconsideration level of appeal, you will be advised in the letter you receive with respect to where you need to send your next appeal, and the deadline for sending that appeal. If you are attempting to stop the recoupment of any monies at this level following a post-payment audit, you must appeal within 30 days of the date of the appeal decision.
The next appeal level is to an entity called the Office of Medicare Hearings and Appeals (OMHA) for a decision by an Administrative Law Judge (ALJ).
Practice Note: Remember that because of the postal situation, redetermination letters are often delayed. Current regulations assume you receive the letter five (5) days after it was sent (although this may be relaxed), so it is important to date-stamp the letter and envelope when received in case there is an issue of timeliness and good cause for late filing. Make sure you date-stamp the reconsideration when it is received. If you do not receive the reconsideration letter by day 65 (60 days plus the five (5) days for mailing) you have the right to escalate to the next level of appeal, which is an appeal to the ALJ. This is usually not a recommended practice because it can get complicated if you get a favorable response from the QIC while you have already appealed to the next level. If you choose to escalate your appeal to the ALJ, you are also required to send a copy of your escalation request to the QIC that is processing your appeal. The QIC then gets and additional five (5) days from receipt of your escalation letter to render a reconsideration.
Administrative Law Judge – this is the third level of the appeals process and you send the appeal to the OMHA office identified in your reconsideration letter within 60 days from the date you receive the reconsideration letter, which you should have date-stamped upon receipt. You must have at least $180 at issue (this is the 2021 and 2022 amount in controversy requirement). The ALJ is an employee of OMHA, which is an agency within the Department of Health and Human Services (HHS) that has the authority to perform the third level of appeal in the Medicare appeal process. This level allows you to present your appeal to an ALJ who will independently review your appeal and listen to your testimony before making a new and impartial decision. These hearings are normally held by phone but can be held by video-teleconference or in-person if the ALJ finds compelling cause for doing so. The ALJ or an attorney adjudicator may also issue a decision without holding a hearing if, for example, information in your appeal record supports a decision that is fully in your favor, or you waive your right to a hearing.
The ALJ or attorney adjudicator has 90 days to render a decision (this timeframe may be enlarged depending on the case type). Should you be unsuccessful at the ALJ level of appeal, you will be advised in the letter you receive with respect to where you need to send your next appeal, and the deadline for sending that appeal.
The next appeal is to the Medicare Appeals Council (Council) and must be filed within 60 days of the date you receive the ALJ decision. This is a paper only appeal and this level is usually only used when you believe the ALJ used the wrong law or regulation, applied the correct law incorrectly or the ALJ disregarded a material fact that significantly impacted the decision. It is not used to rehash an argument of medical necessity.
Practice Note: While you can request that a decision be made without holding a hearing, based upon the existing appeal record, this is not recommended unless you have an absolutely clear case that should be fully favorable. If you are appealing at this level, make sure that the documents being reviewed by the ALJ are the same documents that you have and that were used at the other levels of appeal. It is not uncommon that all of the documents sent to the QIC do not make it into the ALJ file. This is usually the first time that you are provided an opportunity to actually speak with the reviewer about your claim (you would have the same opportunity if a Discussion Period was available). It is imperative that you come prepared and organized. The ALJ has an enormous caseload and the easier that you can make it for the judge, the better chances you have for success. This is the time to tell the story – why did this particular patient, because of their specific medical condition, require the items or services they received and show how that story is supported by the medical record. Don’t forget to date-stamp the decision in case you need to appeal to the next level.
This document has outlined the basics of the first three (3) levels of appeal for Medicare Fee for Service claims. The regulations that govern the appeals process are very complex and failure to adhere to these requirements may mean that your appeal gets dismissed. Engage Health Solutions is well-versed in the intricacies of the appeals process, with its staff having over 25 years of experience in this environment, having overseen the QIC level of appeal, and having also attended Discussion Period conversations and ALJ hearings while representing its clientele.